What are controversial weapons?

Controversial weapons is an ESG term used by investors, regulators and ESG ratings firms to describe weapons whose manufacture, distribution or use is widely restricted or prohibited under international law.

Although neither the United Nations, the United States nor the European Union has issued a single formal definition of controversial weapons, there is broad consensus across ESG frameworks on which weapons should be excluded from sustainable investment portfolios.

This consensus is derived from a combination of international treaties, conventions and regulatory frameworks that underpin controversial weapons screening and exclusions in ESG investing. 

Examples include: 

• The Chemical Weapons Convention
• The Treaty on the Prohibition of Nuclear Weapons
• The EU Sustainable Finance Disclosure Regulation (SFDR)
  • Controversial weapons exclusions are explicitly embedded in EU benchmark regulations such as Climate Transition Benchmarks (CTB) and Paris-Aligned Benchmarks (PAB)

Which weapons are classified as ‘controversial’ under ESG frameworks?

ESG ratings firms generally agree that involvement in the manufacture and/or distribution of any of the following weapons constitutes controversial weapons involvement for the purposes of ESG exclusions and screening: 

• Biological weapons
• Nuclear weapons
• Chemical weapons
• Depleted uranium weapons
• Incendiary weapons
• Cluster munitions
• Anti-personnel land mines

These categories form the foundation of controversial weapons screening used by asset managers, index providers and ESG data vendors.

Companies identified as having any involvement in these weapons are typically excluded from sustainable, Paris-aligned or impact-focused investment strategies. 

Why have controversial weapons exclusions become more important for investors?

Investor interest in separating controversial weapons from conventional weapons has intensified over the last three years.  

This has largely been driven by the European Commission’s decision to classify most conventional weapons manufacturing as a potentially positive ‘defence’ activity following Russia’s invasion of Ukraine.

As a result, many ESG investors now take the position that their portfolios may include exposure to conventional weapons manufacturers, while maintaining strict controversial weapons exclusions.

This distinction has made robust controversial weapons screening increasingly important for ESG-focused portfolios.

These exclusion requirements are reinforced by EU sustainable finance regulation, including the evolving EU Sustainable Finance Disclosure Regulation and the ESMA guidance on ESG and Sustainability fund names. 

Why are ‘controversial weapons’ still debated in ESG?

The term controversial can be misleading in an ESG context, as there is little or no debate over whether the manufacture of chemical or biological weapons should be prohibited. However, disagreements persist across jurisdictions and regulatory frameworks for certain weapons categories.

Examples include:

• The United States has not ratified international conventions banning cluster munitions and anti-personnel land mines.
• The EU Sustainable Finance framework does not classify nuclear weapons as controversial weapons.
• No listed companies classified as being involved in nuclear weapons manufacture nuclear warheads directly; involvement typically occurs through the supply chain for delivery systems, such as ballistic missile components.

These differences explain why controversial weapons classifications can vary between ESG data providers and regulatory regimes. 

How do ESG ratings firms identify controversial weapons involvement?

It is a common misconception that companies involved in controversial weapons disclose this activity clearly in their public reporting.

In practice, aerospace and defence companies rarely acknowledge the manufacture of controversial weapons systems, and almost never disclose the proportion of revenues derived from them.

As a result, ESG ratings firms - including Integrum ESG - rely on a combination of:

• Published company acknowledgements
• Unrefuted, credible press reporting
• Research from specialist defence analysts, NGOs and reputable advocacy organisations

This triangulated approach is necessary to identify controversial weapons involvement with a high degree of confidence.

Read more about how controversial weapons screening can be applied in practice within fund and portfolio analysis. 

Revenue thresholds in controversial weapons screening

Investors seeking to avoid any exposure to controversial weapons typically apply a zero-revenue threshold when conducting controversial weapons screening.  

This reflects both ethical considerations - where even minimal involvement is considered unacceptable - and practical limitations, as accurately estimating revenues from specific weapons categories is often impossible.

How many listed companies are involved in controversial weapons?

Across the global listed universe, only a small number of companies are identified as having any controversial weapons involvement.  

At the time of writing, the Integrum ESG screener excludes 45 listed companies for controversial weapons involvement, with the clear majority linked to participation in the nuclear weapons supply chain. 

Updated as at January 2026. Definitions and regulatory treatment of controversial weapons continue to evolve across jurisdictions and ESG frameworks.